The tax lien simply gets paid off at settlement out of the sellers proceeds.

. - Identity theft while in escrow, causing the underwriter and I to get a zillion pings about new debt, throwing ratios way off.

This is a unique situation where we want to offer Person 2 30% of non-voting stocks, but the end game is Person 2 gets to have 50% of net profit for providing financial backup up to 500k in the form of supplier debt or cash on projects that we present Person 2.

I know for single family residential approval is based upon personal debt to income ratios.

Also, for small investors with limited capital you should be vary concerned with taking on too much debt as you can drown in it.  

Not sure what my question is, I'm just confused and trying to find other ways to passive income other than buying rentals, which seems like a lot of work and debt to go into for $300-$500 per door if I'm financing the properties. 

Granted only get 70% of sale price but should be enough to clear all debt off of myself and rentals will pay for each other.

I don't know squat about NY RE, but it sounds like these sellers are trying to exclude folks using HML, and look for only a) All cash buyers or b) HELOC buyers.If you want to play in this arena, and that is what is going down, I'd suggest opening a HELOC on some other property you own with the highest maximum credit line that your equity position will allow but a $0 current balance.Offer accepted, max out the HELOC, funds arrive next day, show proof to seller.Then you would use the HML to pay off the HELOC a few weeks later, if you'd prefer that the debt be secured by the subject property.

The Gross operating income is without any debt service (P or I).What's funny is the duplex numbers are better than the comparable SFH numbers I have in columns D and E, for which I'm using the 1% rule, which I've heard is a tough number to achieve.

Also I would need to secure funding, but have a small nest egg to work with and like I said we have W2 income with great credit, low debt/income ratio.